France doesn’t want automatic debt-reduction rules. Never did.

 Instead, in 1997, France insisted on adding the word “growth” to Germany’s idea for a “stability” pact. The result was the Stability and Growth Pact (SGP). 

Thus, an insane contradiction was born, one now lurking at the very heart of Europe. Think about it. Stability and Growth? Deflationary and Inflationary policies? Not even the title makes sense. 

The SGP was supposed to enforce the 1992 Maastricht rules: deficits at no more than 3 per cent of GDP, and debt no higher than 60 per cent.

Of course, these rules were quickly broken. 

And then, of course, came Covid. The general escape clause of the SGP was activated, which: . . . allows the Commission and the Council to depart from the budgetary requirements that would normally apply.

Unsurprisingly, many European budget deficits are today greater than 3 per cent…

Edward Price FT 23 June 2023

https://www.ft.com/content/043654b4-b5c1-4770-9d6d-6194336608a5